IGI Airport Metro to go on, but who pays 2,000cr debt?

Amid indications of DMRC likely to take over the operation of Airport Metro Express from next month invoking “large public interest” , there is no clarity on who would repay the debt of at least Rs 2,000 crore in case the present contract gets terminated

NEW DELHI: Amid indications of DMRC likely to take over the operation of Airport Metro Express from next month invoking "large public interest" , there is no clarity on who would repay the debt of at least Rs 2,000 crore in case the present contract gets terminated .

According to senior Union urban development ministry officials, the DMRC has proposed that the debt can be repaid by both Government of India and Delhi government, the promoters of the "hybrid" public-private-partnershi (PPP) project. But the ministry maintains that the Centre should not be made to bear this burden since the contract is between DMRC and Delhi Airport Metro Express Line (DAMPEL). Officials told TOI that the corporation should arrange fund for such take over of the project.

The logic behind this argument is that the project was bid out based on certain projects and conditions, particularly high daily ridership of 40,000 passengers. However, till now the maximum ridership was hovering around 20,000 to 21,000. It has nearly halved to around 10,000 per day since the line was reopened after six months suspension . This is nowhere close to the projects made in the detailed project report (DPR). "Responsibility of preparing a faulty DPR should be fixed. However, considering the public interest we have supported that DMRC should immediately take over the project after DAMPEL exits," said a ministry official in condition of anonymity.

Significantly, everyone in the ministry seemed tightlipped over the huge debt issue . Even the UD secretary Sudhir Krishna did not comment on this issue, though he said that the DMRC board has asked the private company to continue operation. "We have said that DMRC would take over operation in case the company stops work. We have nothing more to add," he said.

Meanwhile, senior officials that since huge debt of the consortium of lenders led by Axis bank is caught in this project ideally they should be allowed either to bring back DAMPEL to operate the line or find a substitution of the present operator, which usually happens in a PPP infrastructure project.

Officials admitted that the project would never be financially viable until the cost of tickets is reworked on this premier line. "Why will people use this line for regular commuting when they have to pay very high price? It has to be somewhere close to the normal Metro tickets on other lines," one of them said. He added that no matter who replaces as the operator with the present level of ridership the project would never become "viable" .

STUMBLING BLOCKS

Project awarded in 2008 to Reliance JV. Scheduled to open airport line in 2010. Project delayed and opens in 2011. Again closes in July 2012 due to problems in structure

DMRC did tunnelling and civil works

DAMEPL installed tracks, electrification, signalling and railway systems, as well as procured and maintained rolling stock

DAMEPL restarts operations on Jan 23, 2013

Check-in : Only at New Delhi railway station at present with Jet Airways and Air India (domestic only)

DAMEPL has been trying to earn revenue through on-site commercial ventures, promotional events (even allowed a shoot during the close-down for repairs), use of real estate